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Strength of UK Economy

Volume 714: debated on Tuesday 17 May 2022

Last year, the UK was the fastest growing economy in the G7, and unemployment has fallen back to 3.7%, which is well below pre-pandemic levels. Growth in the first quarter here was stronger than that in the United States, Germany and Italy, and it is now 0.7% above pre-pandemic levels. The International Monetary Fund forecasts that the UK will be the second fastest growing economy this year and that by 2025 we will once again outpace the rest of the G7, with the fastest growing economy both that year and in 2026.

Across the 38 countries of the OECD only Spain had a bigger fall in its GDP from pre-pandemic levels than the UK. The UK is now uniquely placed in the cost of living crisis, owing to a decade of low growth under Conservative Governments. Can the Minister name any G20 country other than the UK that is forecast to have negative growth in 2023?

The UK has bounced back so strongly from the pandemic that we had the fastest growth last year, we have the second fastest growth this year and we are going to be leading the pack once again. So, we will have the second fastest growth in the G7 in 2024, and we will have the fastest growth in 2025 and 2026. We should be proud of that achievement. There is no doubt that, if we come out of a crisis earlier, there will be an element of other economies catching up in the near term, but the IMF is clear that over the course of the immediate outlook we are world leaders.